Everspin continues to generate profits, reporting positive GAAP
net income for the 9th quarter in a row along with strong
operational cash flow in its second quarter results.
Everspin Technologies, Inc. (NASDAQ: MRAM), the market leader in
MRAM, today announced preliminary unaudited financial results for
the second quarter ended June 30, 2023.
Second Quarter 2023 Highlights
- Q2’23 revenue exceeded the top end of guidance at $15.7
million.
- The company reported net income of $3.9 million for Q2’23
compared to $0.8 million for Q1’23.
- Adjusted EBITDA for Q2’23 was $5.4 million compared to $2.3
million for Q1’23.
- Basic EPS for Q2’23 was $0.19 compared to $0.04 in Q1’23.
- Everspin generated cash flows from operating activities of $6.3
million for Q2’23.
- Everspin ended Q2’23 with cash and cash equivalents of $30.8
million.
- Everspin received a one-time employee retention tax credit of
$2.0 million.
“Everspin delivered revenue of $15.7 million in the second
quarter, above the high end of guidance, while managing through the
supply chain constraints for our Toggle business and delivering a
strong performance on our Radiation Hard programs,” said Sanjeev
Aggarwal, President & CEO. "We continue to exceed expectations
on our Radiation Hard programs to deliver STT-MRAM based solutions
for a "high-density memory array" and a "distributed configuration
memory" for instant-on FPGAs with multiple time programmability.
Healthy backlog in our industrial and automotive markets indicate
strength in our core businesses.”
Second Quarter 2023 Results
Total revenue for the second quarter of 2023 was $15.7 million,
an increase of 6% from the $14.8 million reported in the first
quarter of 2023. This is an increase of 7% compared to $14.7
million of revenue in the second quarter of 2022.
MRAM product sales in the second quarter of 2023, which includes
both Toggle and STT-MRAM revenue, was $13.4 million, compared to
$13.8 million reported in the first quarter of 2023. This is
compared to $13.2 million reported in the second quarter of
2022.
Licensing, royalties, patents and other revenue was $2.3
million, an increase from $1.1 million reported in the first
quarter of 2023. This is an increase of 58% from $1.5 million
reported in the second quarter of 2022.
Second quarter 2023 revenue increased from the prior quarter due
to licensing revenue related to Everspin’s RAD-Hard projects.
Gross margin for the second quarter of 2023 was 58.4%, compared
to 56.8% in the first quarter of 2023 and 58.4% in the second
quarter of 2022.
GAAP operating expenses were $7.6 million in the second quarter
of 2023, compared to $7.7 million in the first quarter of 2023 and
$6.9 million in the second quarter of 2022. GAAP operating expenses
increased in the second quarter of 2023 compared to the second
quarter of 2022 as a result of increased development costs related
to Everspin’s new xSPI family of lower density STT-MRAM products
that are currently in low volume production.
GAAP net income for the second quarter of 2023 was $3.9 million,
or $0.19 per basic share, based on 20.7 million weighted-average
basic common shares outstanding. This is compared to net income of
$0.8 million, or $0.04 per basic share, in the first quarter of
2023 and net income of $1.7 million, or $0.08 per basic share, in
the second quarter of 2022.
Cash and cash equivalents as of the end of the second quarter of
2023 were $30.8 million, compared to $24.2 million as of the end of
the first quarter of 2023, and $23.1 million as of the end of the
second quarter of 2022.
Everspin generated cash flows from operating activities of $6.3
million in the second quarter of 2023, compared to $1.2 million in
the first quarter of 2023, and $4.3 million in the second quarter
of 2022.
During the second quarter of 2023, Everspin received a one-time
Employee Retention Tax Credit (ERTC) refund from the United States
Treasury totaling $2.0 million. The refund was received pursuant to
provisions within the Coronavirus Aid, Relief, and Economic
Security Act. Everspin recorded the one-time ERTC within other
income during the second quarter of 2023.
Business Outlook
For the third quarter 2023, Everspin expects total revenue in a
range of $15.4 million to $16.4 million. Everspin expects GAAP net
income per basic share to be between $0.01 and $0.06.
This outlook is dependent on Everspin's current expectations,
which may be impacted by, among other things, evolving external
conditions, such as the resurgence of COVID-19 and its variants,
local safety guidelines, worsening impacts due to supply chain
constraints or interruptions, including due to the military
conflict in Ukraine and recent market volatility, semiconductor
downturn and the other risk factors described in Everspin's filings
with the Securities and Exchange Commission (the "SEC"), including
its Annual Report on Form 10-K for the fiscal year ended December
31, 2022, its Quarterly Reports on Form 10-Q filed with the SEC
during 2023, as well as in its subsequent filings with the SEC.
Use of Non-GAAP Financial Measures
Everspin supplements the reporting of its financial information
determined under generally accepted accounting principles in the
United States of America (GAAP) with Adjusted EBITDA, which is a
non-GAAP financial measure. Everspin defines Adjusted EBITDA as net
income adjusted for interest expense, taxes, depreciation and
amortization, stock-based compensation expense, and restructuring
costs if any.
Everspin’s management and board of directors use Adjusted EBITDA
to understand and evaluate its operating performance and trends, to
prepare and approve its annual budget and to develop short-term and
long-term operating and financing plans. Accordingly, Everspin
believes that Adjusted EBITDA provides useful information for
investors in understanding and evaluating its operating results in
the same manner as its management and board of directors. Adjusted
EBITDA is a non-GAAP financial measure and should be considered in
addition to, not as superior to, or as a substitute for, net income
reported in accordance with GAAP. Moreover, other companies may
define Adjusted EBITDA differently, which limits the usefulness of
this measure for comparisons with such other companies. Everspin
encourages investors to review its financial statements and
publicly-filed reports in their entirety and not to rely on any
single financial measure.
Conference Call
Everspin will host a conference call for analysts and investors
on Wednesday, August 2, 2023, at 5:00 p.m. Eastern Time. Interested
participants can pre-register online to receive a telephone number
and a unique passcode at:
https://register.vevent.com/register/BI6f420adaead04896a89f74be1072e951
The conference call will be broadcast live in listen-only mode
at:
https://edge.media-server.com/mmc/p/k8k7f8ap
The registration link and archived webcast will be available in
the Investor Relations section of Everspin’s website at
investor.everspin.com.
About Everspin Technologies
Everspin Technologies, Inc. is the world’s leading provider of
Magnetoresistive RAM (MRAM). Everspin MRAM delivers the industry’s
most robust, highest performance non-volatile memory for Industrial
IoT, Data Center, and other mission-critical applications where
data persistence is paramount. Headquartered in Chandler, Arizona,
Everspin provides commercially available MRAM solutions to a large
and diverse customer base. For more information, visit
www.everspin.com. NASDAQ: MRAM.
Cautionary Statement Regarding Forward-Looking
Statements
This press release contains forward-looking statements regarding
future results that involve risks and uncertainties that could
cause actual results or events to differ materially from the
expectations disclosed in the forward-looking statements,
including, but not limited to the statements made under the caption
“Business Outlook.” Forward-looking statements are identified by
words such as “expects” or similar expressions. These include, but
are not limited to, Everspin’s future financial performance,
including the outlook for third quarter 2023 results. Actual
results could differ materially from these forward-looking
statements as a result of certain risks and uncertainties,
including, without limitation, the risks set forth under the
caption “Risk Factors” in Everspin’s Annual Report on Form 10-K for
the year ended December 31, 2022 filed with the SEC on March 2,
2023, and its Quarterly Reports on Form 10-Q filed with the SEC
during 2023, as well as in its subsequent filings with the SEC. Any
forward-looking statements made by Everspin in this press release
speak only as of the date on which they are made and subsequent
events may cause these expectations to change. Everspin disclaims
any obligations to update or alter these forward-looking statements
in the future, whether as a result of new information, future
events or otherwise, except as required by law.
EVERSPIN TECHNOLOGIES,
INC.
Balance Sheets
(In thousands, except share
and per share amounts)
(Unaudited)
June 30,
December 31,
2023
2022
Assets
Current assets:
Cash and cash equivalents
$
30,830
$
26,795
Accounts receivable, net
9,026
10,665
Inventory
7,345
6,683
Prepaid expenses and other current
assets
411
604
Total current assets
47,612
44,747
Property and equipment, net
3,522
3,883
Right-of-use assets
6,074
6,641
Other assets
62
62
Total assets
$
57,270
$
55,333
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
1,230
$
2,778
Accrued liabilities
2,832
3,533
Deferred revenue
725
821
Current portion of long-term debt
—
2,594
Lease liabilities, current portion
1,156
1,122
Other liabilities
50
27
Total current liabilities
5,993
10,875
Long-term debt, net of current portion
—
—
Lease liabilities, net of current
portion
4,991
5,580
Long-term income tax liability
214
214
Total liabilities
$
11,198
$
16,669
Commitments and contingencies (Note 5)
Stockholders’ equity:
Preferred stock, $0.0001 par value per
share; 5,000,000 shares authorized; no shares issued and
outstanding as of June 30, 2023 and December 31, 2022,
respectively
—
—
Common stock, $0.0001 par value per share;
100,000,000 shares authorized; 20,743,422 and 20,374,288 shares
issued and outstanding as of June 30, 2023 and December 31, 2022,
respectively
2
2
Additional paid-in capital
188,126
185,364
Accumulated deficit
(142,056
)
(146,702
)
Total stockholders’ equity
46,072
38,664
Total liabilities and stockholders’
equity
$
57,270
$
55,333
EVERSPIN TECHNOLOGIES,
INC.
Statements of Income and
Comprehensive Income
(In thousands, except share
and per share amounts)
(Unaudited)
Three Months Ended June
30,
Six Months Ended June
30,
2023
2022
2023
2022
Product sales
$
13,406
$
13,223
$
27,183
$
25,894
Licensing, royalty, patent, and other
revenue
2,341
1,484
3,410
3,160
Total revenue
15,747
14,707
30,593
29,054
Cost of product sales
6,090
5,793
12,213
11,545
Cost of licensing, royalty, patent, and
other revenue
464
323
757
595
Total cost of sales
6,554
6,116
12,970
12,140
Gross profit
9,193
8,591
17,623
16,914
Operating expenses:1
Research and development
2,708
2,699
5,907
5,135
General and administrative
3,507
2,860
6,727
5,589
Sales and marketing
1,355
1,292
2,670
2,426
Total operating expenses
7,570
6,851
15,304
13,150
Income from operations
1,623
1,740
2,319
3,764
Interest expense
—
(70
)
(63
)
(145
)
Other income (expense), net
2,262
1
2,390
(13
)
Net income before income taxes
3,885
1,671
4,646
3,606
Income tax expense
—
—
—
—
Net income and comprehensive income
$
3,885
$
1,671
$
4,646
$
3,606
Net income per common share:
Basic
$
0.19
$
0.08
$
0.23
$
0.18
Diluted
$
0.18
$
0.08
$
0.22
$
0.17
Weighted average shares of common stock
outstanding:
Basic
20,657,404
20,069,444
20,554,769
19,983,526
Diluted
21,234,253
20,424,283
21,068,059
20,626,547
1Operating expenses include stock-based
compensation as follows:
Research and development
$
503
$
462
$
949
$
795
General and administrative
624
647
1,235
1,018
Sales and marketing
133
202
236
322
Total stock-based compensation
$
1,260
$
1,311
$
2,420
$
2,135
EVERSPIN TECHNOLOGIES,
INC.
Statements of Cash
Flows
(In thousands)
(Unaudited)
Six Months Ended June
30,
2023
2022
Cash flows from operating
activities
Net income
$
4,646
$
3,606
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
617
462
Gain on sale of property and equipment
(15
)
(167
)
Stock-based compensation
2,420
2,135
Loss on prepayment and termination of
credit facility
170
—
Non-cash warrant revaluation
23
(21
)
Non-cash interest expense
26
62
Changes in operating assets and
liabilities:
Accounts receivable
1,639
(1,090
)
Inventory
(662
)
20
Prepaid expenses and other current
assets
193
(38
)
Other assets
—
664
Accounts payable
(741
)
(201
)
Accrued liabilities
(701
)
(1,414
)
Deferred revenue
(96
)
(832
)
Lease liabilities
12
164
Net cash provided by operating
activities
7,531
3,350
Cash flows from investing
activities
Purchases of property and equipment
(1,063
)
(996
)
Proceeds received from sale of property
and equipment
15
202
Net cash used in investing activities
(1,048
)
(794
)
Cash flows from financing
activities
Payments on long-term debt
(2,790
)
(1,200
)
Proceeds from exercise of stock options
and purchase of shares in employee stock purchase plan
342
286
Net cash used in financing activities
(2,448
)
(914
)
Net increase in cash and cash
equivalents
4,035
1,642
Cash and cash equivalents at beginning of
period
26,795
21,409
Cash and cash equivalents at end of
period
$
30,830
$
23,051
Supplementary cash flow
information:
Interest paid
$
37
$
83
Operating cash flows paid for operating
leases
$
692
$
635
Financing cash flows paid for finance
leases
$
6
$
5
Non-cash investing and financing
activities:
Right-of-use assets obtained in exchange
for operating lease liabilities
$
—
$
3,350
Right-of-use assets obtained in exchange
for finance lease liabilities
$
—
$
36
Purchases of property and equipment in
accounts payable and accrued liabilities
$
—
$
783
EVERSPIN TECHNOLOGIES,
INC.
Adjusted EBITDA
Reconciliation
(In thousands)
(Unaudited)
Three Months Ended
June 30, 2023
March 31, 2023
June 30, 2022
Adjusted EBITDA reconciliation:
Net income
$
3,885
$
761
$
1,671
Depreciation and amortization
284
333
204
Stock-based compensation expense
1,260
1,160
1,311
Interest expense
-
63
70
Income tax expense
-
-
-
Adjusted EBITDA
$
5,429
$
2,317
$
3,256
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230802911515/en/
Anuj Aggarwal, CFO T: 480-347-1082 E:
anuj.aggarwal@everspin.com
Everspin Technologies (NASDAQ:MRAM)
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